Boerse/NYSE offer concessions for merger approval

Fri Nov 18, 2011 8:07am EST
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By Harro Ten Wolde and Foo Yun Chee

FRANKFURT/BRUSSELS (Reuters) - Financial exchanges Deutsche Boerse AG DB1Gne.DE and NYSE Euronext NYX.N are offering to sell some businesses and give rivals access to a major derivatives clearing house to win support from antitrust regulators for their $9 billion merger.

The concessions offered by the two companies on Friday could clear the way for the biggest of a raft of planned exchange mega-mergers announced in the past year and the only one still surviving regulatory scrutiny and other obstacles.

The announcement confirmed an earlier report by Reuters. Sources said the exchange operators submitted the plan to the European Commission late on Thursday, right on deadline for addressing the concerns raised over their combined grip on derivatives trading.

Deutsche Boerse and NYSE Euronext said they planned to sell off significantly overlapping parts of their single-stock equity derivatives businesses in key markets, which include France, Belgium, Germany, the Netherlands, and Britain.

They also said they would allow rival exchanges to clear interest-rate and equity-index derivatives on Deutsche Boerse's clearing house, Eurex Clearing, but only if the products were "new and innovative".

That means rivals such as London Stock Exchange Group Plc (LSE.L: Quote) or Chicago-based CME Group Inc (CME.O: Quote) would not be able to clear existing, or even new "copycat" products, under the plan.

Amelia Torres, the EU Commission's competition spokeswoman, confirmed that the regulator had received the exchanges' proposed remedies and said deadline for a decision has been extended to January 23 from December 22.